Romania scores well with cheap food and non-alcoholic beverage, but ranks last on purchasing power in the EU

Food and non-alcoholic beverages in Romania are among the cheapest in the European Union, but the purchasing power is low too; the lowest in the EU, according to a recent report with data on 2012.

Food prices in Romania are two thirds of the EU average, and for cheese, milk and eggs, the prices are close to the average, according to recent data issued by the Eurostat statistical office. The price of food and of non-alcoholic beverages are 67 percent of the EU average.

Romanians pay 63 percent of the EU average price for bread and cereals, and for meat, 57 percent of the EU average price.

Prices for food and non-alcoholic beverages vary widely across the EU, with Romania, Bulgaria and Poland having the lowest prices – around 70 percent of the EU average. The lowest price levels – half the EU average and below – are found in Serbia, Bulgaria, Albania and in the former Yugoslav Republic of Macedonia.

Prices are higher in Denmark – 143 percent of the EU average, Sweden – 124 percent, and Austria, 120 percent. Food costs 81 percent of the EU average in neighboring Hungary, while the percentage is of 84 in the Czech Republic. In Germany, prices are slightly above the EU average – 106 percent, similarly to Greece. Spain is at 93 percent, while Italy, at 111 percent.

Amongst the Member States, Denmark is the most expensive country for food and non-alcoholic beverages. Finland has the highest price level for alcoholic beverages in the EU, while Ireland is by far the most expensive for tobacco. The former Yugoslav Republic of Macedonia is the least expensive country of all 37 in all four product groups. Among the EU Member States, the lowest prices for food are observed in Poland, for alcoholic beverages in Bulgaria, for non-alcoholic beverages in Romania and for tobacco in Hungary. Among the EU Member States, Poland is the most inexpensive country for all sub-categories.

Exchange rates are crucial in determining price level indices, and exchange rate movements consequently often have a big impact on the development of price levels over time, according to Eurostat. In fact, several of the major price level changes observed between 2009 and 2012 can be at least partly explained by fluctuations of country’s currencies against the euro, the statistics office explained.

Purchasing power also varies across Europe, expressed by the real individual consumption per capita, according to Eurostat, and for Romania it is down to less than half of the EU average- 48 percent, ranking last in the EU. In Poland, the purchasing power is higher – 71 percent of the EU, while prices are also lower than in Romania.